Why did my equifax score drop 12 points

My transunion score in August 2011 was 732 and equifax was 725. I just pulled my credit report today 1/10/2012 and my transunion stayed at 732 but my equifax is at 713. The only change that I see is that my credit card balance has been zero for a few months. Does not using credit cards and maintaining zero balance hurt your credit score?

Re: Why did my equifax score drop 12 points

perfectscore wrote:My transunion score in August 2011 was 732 and equifax was 725. I just pulled my credit report today 1/10/2012 and my transunion stayed at 732 but my equifax is at 713. The only change that I see is that my credit card balance has been zero for a few months. Does not using credit cards and maintaining zero balance hurt your credit score?

Welcome to the forums.

As a matter of fact showing all zero balances all the time will hurt your score. I know that seems counter productive but that's the way it is. It seems like what helps most people is to only have one of their credit card accounts report a small (<9% of it's credit limit) each month and let any other CC accounts report a zero balance.

Re: Why did my equifax score drop 12 points

I still have mortgage and student loans that I make timely payments on. I just don't use my credit card (only have one). So you are saying that I should charge something (<9%) every month? Can I pay it off every month? I don't want to carry a balance on my credit card and pay unnecessary interest. Please help!!!! My new years resolution 2012 is to be at 750+ by the end of the year. But seeing my equifax score go backwards is really painful.

Re: Why did my equifax score drop 12 points

perfectscore wrote:I still have mortgage and student loans that I make timely payments on. I just don't use my credit card (only have one). So you are saying that I should charge something (<9%) every month? Can I pay it off every month? I don't want to carry a balance on my credit card and pay unnecessary interest. Please help!!!! My new years resolution 2012 is to be at 750+ by the end of the year. But seeing my equifax score go backwards is really painful.

You don't have to use it every month. Every 2-3 months will be fine. Even a $1 charge is enough to show activity. Then wait for it to report on your monthly statement and PIF (Pay In Full) before the due date and you will never pay a penny in interest.

Re: Why did my equifax score drop 12 points

You are very welcome. Another option is to use that card each month to auto pay a recurring bill (water, gas, cable, etc.) so you don't have to worry about how long it's been since you last used the card. I do this for most of my cards.

Re: Why did my equifax score drop 12 points

It's also worth noting that the ding for all-zero CC balances is a particular specialty at Equifax. I did a series of tests a couple of years ago of what the impact was, for both EQ and TU like your comparison. I found my EQ FICO score went down by 4 points and TU FICO went up by 6, for all zero balances, compared to my usual situation maintaining a $10 balance on one card account. I went through several cycles and found this pattern to be absolutely repeatable. YMMV, of course.

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